Case Study: CAPEX decisions affecting OPEX budgets

Background:

KerTec is a soil science based environmental reclamation company providing consulting, planning, installation services, vegetation management services (including grazing) to utility-scale solar customers throughout the United States. Over the past decade, KerTec has been engaged to remedy failures in solar facilities related to mismanagement of soil and vegetation during construction. Through the forensic process of identifying causes of failure, KerTec has gained valuable experience in identifying site risks that go unrecognized by the construction management or civil engineering disciplines. In addition to identifying site risks, KerTec has leveraged decades of combined land stewardship experience to develop and execute preventative and corrective strategies to soil-based problems negatively impacting solar facility’s ESG (Environmental, Social, and Governance) goals and OPEX economic feasibility.??

Purpose:

To utilize soil science criterion before and during construction to recognize points of diminishing financial return and execute corrective actions related to soil-based construction impacts.? CAPEX-based soil science criterion left unexecuted or executed incorrectly during construction costs 10x-20x to complete during OPEX. The 10x-20x elevated costs are attributed to the reduced maneuverability due to the above ground solar infrastructure.?

Case Studies:

?Site 1: Estimated Correction: $2.1MM

Pre-existing invasive species, Mesquite (Prosopis glandulosa) were not properly cleared during the construction phase of the project. Blading the work area temporarily relieved the site of this vegetative pressure. Per USDA-NRCS, mesquite is a resprouting woody shrub/tree species capable of resprouting when not removed to a depth of 14 inches below the soil surface.? Therefore, removing the above ground parts of the plant does not terminate the plant.? Each below ground root mass will generate new woody stems, far outnumbering that of the original plant stem count. New stems are capable of growing 5-10 feet in height per year.? These woody stems are rigid and thorny and have the capacity to become entangled in solar drivelines, wear through wire insulation causing system faults, create shading, create fire risk, and jeopardize insurance coverage compliance.

?The treatment of mesquite resprouts is only accomplished by individual stem cutting and treatment with herbicide versus correctly grubbing mesquite plants to a depth of 14 inches during the clearing process.? Individually treating thousands of stems per acre hand hand is 10x more expensive than mechanically removing the root mass during the clearing process.?

?Construction clearing contractors nor owner representatives were aware of mesquite’s ability to resprout, hence the tremendous oversight.? The oversight wasn’t realized until after commissioning of the site. CAPEX decisions (or lack of understanding) created undue burden to OPEX budget.?

?The cost to individually stem cut and treat with herbicide on ~2000 acres was $2.1MM.??

??Site 2: Estimated Correction: $1.9MM

Construction contractor and owner representative made decisions in the field to not plant the specified species of grass seed because “natural” vegetation was beginning to establish onsite.?

?When asked, the construction contractor nor owner representative knew what species of “natural” grass was beginning to establish onsite.? Upon KerTec’s evaluation, the vegetation was invasive bi-annual tallgrass, Johnsongrass (Sorghum halepense).? Oftentimes, common sunflower (Helianthus annuus) is allowed to persist onsite as “natural” vegetation, but creates the same problems as Johnsongrass.?

?Before construction was complete the Johnsongrass was 7ft tall and shading the panels.? The Johnsongrass was becoming entangled in drivelines and preventing the drivelines from being able to tilt the panels.? The Johnsongrass created a heavy fire fuel load, which created compliance and safety issues with fire safety and insurance compliance.? Traditional mowing equipment was not able to mow the Johnsongrass.? Large diesel power construction equipment was brought in to cut the robust Johnsongrass.??

?To eliminate the Johnsongrass within a fully functioning solar site with herbicide via multiple herbicide application and reseed to a desirable species costs $1.9MM on ~1200 acres. ? This cost is 10x the cost of what proper soil and plant management strategies would have been during construction.?

?Construction civil contractors nor owner representatives were aware of Johnsongrases height potential and persistence, hence the tremendous oversight.? The oversight wasn’t realized until after commissioning of the site.? CAPEX decisions (or lack of understanding) created undue burden to OPEX budget.?

?Site 3: Estimated Correction: $1.5MM

Vegetative debris, natural debris, and remnants from construction were strewn throughout a significant portion of the utility-scale site. The solar sitef O&M department hired KerTec to perform debris cleanup, by hand, on over 550 acres. Ultimately, the debris proved to be a significant safety issue, due to the debris potential to be projected by mowing equipment at a very high rate of speed. By having KerTec conduct proper cleanup measures, this prevented infrastructure damage, or worse yet, injuring onsite or vegetative personnel. Unfortunately, this by-hand-effort was very costly to the solar site owner due to the size of the impact area as well as the limited access within the arrays due to existing infrastructure.

?To remove the construction debris, by hand, in a fully functioning solar site cost $1.5MM on 550 acres. This OPEX cost is 20x the cost of what proper debris management strategies would have been during construction (CAPEX).?

?Construction civil contractors nor owner representatives thought it necessary to remove aforementioned construction debris, hence the tremendous oversight.? The oversight wasn’t realized until after commissioning of the site.? CAPEX decisions (or lack of understanding) created undue burden to OPEX budget.?

?Proposed Solution:

The aforementioned Case Studies on utility-scale solar facilities each impose significant costs to OPEX due to mismanagement of the site during construction (CAPEX). Alternatively, if the solar site owner had soil scientists and vegetative specialists on hand, such as our staff at KerTec, their early involvement could have been identified, forecasted, and prevented the repercussions and long-term effects of decisions made by untrained or inexperienced management.

?KerTec’s ability to aid in the civil design to create plant and soil based metrics for solar solar success is proving to be invaluable to long term solar asset owners.??

?KerTec’s Construction Vegetation Best Management Plan Guides and? Vegetation Management Plans (VMP) consists of soil science fundamentals executed by KerTec’s team of soil scientists and vegetation specialists. Planning, monitoring, oversight, and execution of all soil disturbing activities are to be completed by KerTec throughout construction. Historically, the aforementioned scope is that of the civil contractor, which are not (by default) trained or experienced plant or soil scientists.??

?Upon completion of the construction phase, KerTec will begin implementing agrivoltaics or traditional vegetation management on the solar site, pursuant to the site’s designated Vegetation Management Plan. KerTec’s agrivoltaic or Vegetation Management Plan strategy will be designed, implemented, and monitored by KerTec personnel to ensure ease of operation and cost efficiency for the solar facility’s O&M team.

?Benefits:

Ensure the solar site owner has expert information regarding soils and vegetation and how descoping services during the construction phase will have long-term impact and costs to the site’s OPEX budget. KerTec will work to ensure the solar site owner is duly informed in an effort to mitigate site-corrective vegetation management services mitigating the risk of elevated? OPEX budgets due to CAPEX decisions.